Which Bank’s CDA Is The Best Deal?
Is your baby going to be born soon?
It is good to look around for the best bank to open your baby’s first bank account, Child Development Account (CDA).
As the CDA is going to accompany your child for a long time, it’s worthwhile to spend a little time looking around for the CDA that gives the highest interest rate.
Currently, only POSB, OCBC, and UOB are offering Child Development Accounts (CDA).
All 3 banks offer an interest rate of up to 2% p.a.
POSB CDA
Balances | Interest Rates (% p.a.) |
First $10,000 | 1.00 |
Next $40,000 | 2.00 |
Above $50,000 | 0.05 |
OCBC CDA
Balances | Interest Rates (% p.a.) |
First $10,000 | 0.60 |
Next $10,000 | 0.80 |
Above $20,000 | 2.00 |
UOB CDA
Balances | Interest Rates (% p.a.) |
First $25,000 | 1.00 |
Next $25,000 | 2.00 |
Above $50,000 | 0.05 |
Which Bank’s CDA To Choose?
From the looks of it, it seems like POSB CDA is the best deal!
Anything above $10,000 and below $40,000 yields 2% p.a.
In case you are a rich parent and decides to have more than $50,000 (which is rare) in your child’s CDA, OCBC CDA will be a good choice as anything above $20,000 yields 2% p.a. while POSB and UOB only offer 0.05% p.a. for anything above $50,000.
CDA Benefits From Government
Child Order | First Step Grant | Dollar-for-dollar Matching | Maximum CDA Benefits |
1st Child | S$3,000 | Up to S$3,000 each | S$6,000 each |
2nd Child | S$3,000 | Up to S$6,000 each | S$9,000 each |
3rd & 4th Child | S$3,000 | Up to S$9,000 each | S$12,000 each |
5th Child Onwards | S$3,000 | Up to S$15,000 each | S$18,000 each |
Use Of Child Development Account
You can use the money in your child’s CDA to pay for expenses at the following Baby Bonus Approved Institutions (AIs):
- Child Care Centres
- Kindergartens
- Special education schools
- Providers of early intervention programmes
- Providers of assistive technology devices
- Hospitals and clinics
- Pharmacies
- Optical shops
